By Edward Harrison of Credit Writedowns. When I read Yves Smith’s recent comments on Bank of America’s repayment of its TARP funds, I couldn’t help but think of a post I wrote six months ago called "Asymmetric information and corporate governance in bank bailouts." The gist is of the post is about the same as […]
Read more...The New York Times discusses a study (supposedly released, but the paper has yet to be posted) by corporate governance expert and Harvard Law School professor Lucien Bebchuk (along with Alma Cohen and Holger Spamann) on how much the top echelon at failed firms Bear Stearns and Lehman really suffered when their firms imploded. The […]
Read more...The theater is starting to get interesting. Here in the US we have banker pay theater masquerading as the real thing. Kenneth Feinberg, the so-called pay-czar, struggles to collect a few scalps at the handful of TARP institutions under his domain, with the ever-intransigent AIG making headlines. This of course is meant to distract attention […]
Read more...There is a simply intriguing piece up at Reuters, which may signal a shift in the media version of the zeitgeist as more details of l’affaire Benmosche leak out. By way of background, a very good article at the Financial Times underscores a pet theory of mine: that the board knew exactly what it was […]
Read more...By Marshall Auerback, an investment strategist and analyst who writes for New Deal 2.0. How appropriate that with Halloween just around the corner, the Fed and Treasury have announced a coordinated effort that will put the central bank at the forefront of pay regulation on the zombie firms now kept alive courtesy of US government […]
Read more...By George Washington of Washington’s Blog. What is the current American economy: capitalism, socialism or fascism? Socialism Initially, it is important to note that it is not just people on the streets who are calling the Bush and Obama administration’s approach to the economic crisis “socialism”. Economists and financial experts say the same thing. For […]
Read more...The Wall Street Journal reports that the pay czar, Kenneth Feinberg, is going to cut executive comp at 7 TARP recipients for the 25 most highly paid employees. Does this really mean anything? The press will noise it up as significant (and some outlets will no doubt finger wag at this “interference”) but the short […]
Read more...I was on the Andrew Hall/Phibro beat for a while and must confess I dropped it in the finish-the-book crunch. I neglected to follow up on and important aspect of the story that is still germane. Readers may recall the brouhaha: Hall, a high stakes oil trader, had received nearly $100 million in 2008 at […]
Read more...Submitted by Edward Harrison of Credit Writedowns. In the 1987 movie classic Wall Street, the sinister protagonist Gordon Gekko played by Michael Douglas gives this famous quote: In the last seven deals that I’ve been involved with, there were 2.5 million stockholders who have made a pretax profit of 12 billion dollars. Thank you. I […]
Read more...An interesting contract in reporting today. Reader (Tom C) sent me the Wall Street Journal version of this story, by Michael R. Crittenden and Liam Pleven, titled “AIG Execs Returned Only $19M Of $45M In Pledged Repayments.” I decided to look at Bloomberg as well, as found one on the same subject, “AIG Should Trim […]
Read more...The Financial Times reports that the so-called pay czar Kenneth Feinberg, who is in charge of overseeing compensation at TARP recipients, is going to crack down on some of the bonuses paid at AIG: The Obama administration’s pay tsar has indicated he will take a tough stance on executive pay at AIG, the state-controlled insurance […]
Read more...The Wall Street Journal has a headline that would warm the cockles of any populist’s heart: “Bankers Face Sweeping Curbs on Pay.” And even more impressive, who is going to rein in banker compensation? The Fed. That alone should tell you there is less here than meets they eye. Let’s look at the outline of […]
Read more...Perhaps I place too much emphasis on turn of phrase. However, the fact that the EU officialdom is starting to use feral imagery in describing the posture they intend to take relative to the financial services industry says they have a keen appreciation of what they are up against. The battle lines are being drawn […]
Read more...Conspiracy theorists will have to wait until the article described in Inside Science is published to determine whether it delivers on its claims. It purports to analyze stock holding across 48 countries and alleges they are held in very few hands. But the work was done by physicists, which means they may not have understood […]
Read more...A new and welcome front may be opening in the efforts to rein in an overly powerful and now explicitly state-backed financial services industry: challenging its claims that its activities are good for society. While the provision of credit is important to any economy beyond the barter stage, finance should be the handmaiden of commerce, […]
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